The Fuse network blockchain operates on the Delegated Proof of Stake (DPoS) consensus and is a layer-1 public blockchain that is compatible with the Ethereum Virtual Machine (EVM). This means that applications and smart contracts developed for Ethereum can also be deployed on the Fuse network without the need for code modifications. Fuse Network is also a public blockchain, allowing anyone to interact with it, perform transactions, deploy smart contracts, and operate nodes without requiring permission from intermediaries.

Vertical Integration

Vertical integration is a key part of Fuse's payment network strategy. The goal is to compete with dominant players in the payment industry, such as Visa, Mastercard, and Stripe, and enable mainstream businesses to offer simple, fast, and secure user experiences. Fuse focuses on Small and Medium-sized Enterprises (SMEs) and provides a comprehensive technological package that includes a payment network, business infrastructure, and digital wallets.

Composition of Fuse’s vertical integration:

• Consumer Layer
• Business Layer
• Implementation Layer

Simply put, the customer initiates a payment, the merchant adds a fee, and the entire transaction is sent to a validator who records it on the blockchain.

Fuse Network Consensus Algorithm

The algorithm is based on the AuRa (Authority Round) consensus mechanism developed by the OpenEthereum team (formerly known as Parity). This mechanism allows for the selection of a set of validators and integrates block reward logic with smart contracts.

Fuse’s consensus was created through unique smart contracts for consensus and block rewards, which can be upgraded using proxy contracts. A selected set of validators takes turns to sign and confirm blocks. The signed block is then distributed to all network participants who verify and append it to their state, thus confirming the block.

New blocks are created every 5 seconds, providing validators with a time window to publish their blocks and receive rewards for their work. Although it may theoretically take some time for a transaction to become final in this model, in the Fuse network, a transaction is considered completed after the confirmation of the next block.

Role and entity

The Fuse network contains 4 different roles and entities that are part of the network:

• Power Validators
• Operators
• Users
• Merchants

Power Validators

Power Validators on the Fuse platform play a crucial role in achieving the desired level of decentralization, which is important for businesses. Their task is to ensure the power supply of the Fuse platform's payment infrastructure while actively verifying transactions. These power validators are an integral part of the payment flow and are motivated by receiving a small percentage of each payment for their services. This ensures their motivation and directly links their rewards to the services provided.

Operators

Operators on the Fuse network represent a wide range of real-world business applications, games, dApps, and other services that are capable of running on the Fuse infrastructure.

The main task of operators is to create and maintain applications that integrate payment functionality and provide users with easy access to the Fuse network's features. These operators also take care of supporting application users and ensure compliance with local regulations and rules in their respective jurisdictions.

One of the key benefits of operators is that they bear the majority of the costs associated with payments on the Fuse network, as they are the businesses that utilize the Fuse network to create and deliver products and services to their customers. In this way, operators enable their clients to make payments and transactions using the Fuse network without having to deal with the technical and financial aspects of the blockchain themselves.

Users

The end-users of the applications that have been developed and are managed and maintained by the operators, are those people who will be paying for products and services. They do not have to be blockchain experts, or even particularly tech-savvy to use the Fuse network.

Merchants

Merchants require on / off ramping locally anywhere in the world. They will use out-of-the-box services such as accounting and invoicing Point-of-Sale (POS) and eCommerce plugins. Merchants will also use the out-of-the-box services on Fuse, like accounting, invoicing, POS, and eCommerce.

Fuse SDK

The Fuse Software Development Kit (SDK) is a complete set of tools designed to enable companies to easily integrate Web 3.0 services and cryptocurrency payments into their existing client applications. This product has been created with the aim of providing an easy and efficient way for companies to upgrade their applications while reducing the costs associated with development.

This developer package includes:

• Fuse API
• Indexers, including subgraphs and the explorer
• The Fuse network serves as the underlying infrastructure for the Fuse stack
• Smart wallet contracts and their modules
• Token contracts, including ERC20 tokens and ERC721 (NFTs)
• Token factories for creating new tokens
• Other smart contracts including AMMs of DEXes, DAO contracts, and more

Indexers, including subgraphs and the explorer, are used for efficient data retrieval and processing within the Fuse Stack. These indexers contribute to a better understanding of blockchain data, and facilitate the further exploration of that data.

Fuse Smart Wallets

Smart wallets represent intelligent contract wallets that allow users to easily manage and interact with their assets through client applications. The Fuse Wallet SDK provides a complete set of tools for creating and managing these smart wallets, which is both simple and secure. With the Fuse Wallet SDK, users can create and manage their smart wallets with minimal effort and security. These wallets operate on the principle of non-custodial accounts, meaning users have control over their assets without entrusting their private key to an external party.

Zero Knowledge (ZK)

ZK will be used to create a private ledger, the goal of which is to ensure that transactions are confidential and encrypted while allowing for the verification or transactional legitimacy and adequacy.

ZK proofs enable other network participants to verify the legitimacy and correctness of transaction execution without accessing the actual user data, thereby ensuring transparency and trust within the blockchain ecosystem.

The Fuse blockchain continues to evolve and seeks the best direction and system to solidify its position as a leader among blockchain payment methods. It is therefore advisable to follow their whitepaper, where new technological solutions will be gradually added and explained.
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The whitepaper also provides a detailed insight into the plans and strategy of the Fuse blockchain, and outlines the innovations and enhancements that the Fuse team intends to implement in order to achieve their goals. It serves as a comprehensive document that offers information on the technical aspects, concepts, and unique features of the Fuse blockchain.